Gov’t to use oil and gas revenue to leverage capital markets

Mr Seth Terkper, the Minister of Finance and Economic Planning, on Wednesday said the government would continue to enhance the use of oil and gas resources to leverage the capital markets for the development of the energy sector.

According to him this was part of the new debt management strategy approved by Parliament and the initiative would involve the issuing of energy bonds through plans that draws on synergies among the Balance Sheets of capable State-Owned Enterprises and the private sector.

“ In this context, we will also consider the possibility of a second line of longer term Cocoa Bonds by COCOBOD to fund its long term capital and infrastructure needs”, he said.

Mr Terkper who presented the 2015 Budget Statement to Parliament in Accra, said the 2015 Budget would usher the country into the gas era and Phase II oil-gas production.

To ensure this, government has proposed amendments to enhance the effective implementation of the Petroleum Revenue Management Act 2011 (Act 815), to harness Ghana’s oil resources for savings, stabilisation and development.

He also outlined firm policies for the energy sector that include key elements such as the implementation of the over 400 million United State dollars US MCC Compact II under the Power Africa Program that was planned to attract significant private investment into the energy sector.

He said there would be a major overhaul of the pricing, tax and levy structure for energy utilities and petroleum products as well as a vigorous use of alternative financing instruments for energy and non- energy investments.

This, he said look mainly at the insurance and Partial Risk Guarantee (PRG) tools of the World Bank and the African Development Bank (AfDB), to boost private sector participation in the sector and the economy.